Though performance at the local bourse was bearish last week with the benchmark All Share Index (ASI) shedding 0.3 percent week-on-week (w-o-w) to settle at 40,814.89 points, analysts see bouts of bargain hunting returning the market to a bullish run. The market, which had been in a correction mode since the beginning of March, had shed gains from over 17 percent to a year-to date return of 6.7 percent as at Friday, April 20, 2018.
Traders and research analysts are optimistic on a rebound in the near term, saying they anticipate improved sentiments in the market as investors would seek bargain-hunting opportunities in fundamentally sound stocks that had depreciated with attractive entry prices, especially with Q1 2018 earnings trickling in.
Their optimism is also hinged on the fact that despite the weaker performance last week, the equities market recorded improved activity level and investor sentiment w-o-w.
A review of the market last week indicated that market capitalization lost N41.1 billion in value to settle at N14.7 trillion. The bearish performance of the week was largely due to losses in DANGCEM -4.0%), NIGERIAN BREWERIES (-3.0%) and 11PLC (-14.0%).
However, activity level strengthened as average volume and value traded surged 112.6 percent and 54.2 percent to 601.5 million units and N6.1 billion respectively.
The most traded stocks by volume this week were FCMB (1.1bn), UBA (407.2m) and OANDO (187.1m) while, GUARANTY (N7.9bn), UBA (N4.5bn) and ZENITH (N4.2bn) were the top traded stocks by value. At the start of the week, the ASI fell 97bps, paring gains from the previous session.
However, on Tuesday, bargain hunting in bellwethers – SEPLAT, ZENITH and UBA drove the ASI northwards. Profit taking in the subsequent session dragged performance before rebounding on Thursday following price appreciation in DANGCEM. To close the week, the ASI fell 14bps.
Performance across sectors was largely bearish wo-w as three of five indices under our coverage trended southwards. The insurance index depreciated the most, falling 1.2 percent w-o-w on account of price depreciation in CONTINSURE (-7.4%), WAPIC (-3.6%) and NIGERINS (-8.8%).
Similarly, losses in NIGERIAN BREWERIES (-3.0%), FLOURMILLS (-4.9%) and INTEBREW (-5.0%) pulled the Consumer Goods index 0.9% lower w-o-w while the industrial goods index closed flattish albeit negative (-4bps), dragged by losses in DANGCEM (-4.0%). On the flipside, the banking index was the top performer, inching 2.3 percent as gains in bellwethers – UBA (+5.2%), ZENITH (+3.4%) and GUARANTY (+1.8%) buoyed performance. The Oil & Gas index also appreciated, up 0.7% w-o-w, propped by upticks in OANDO (+39.1%) and SEPLAT (+5.6%).
Investor sentiment as measured by market breadth (advance/decline ratio) strengthened to 1.1x from 1.0x recorded the prior week consequent on 34 stocks advancing against 32 decliners. The top-performing stocks this week were OANDO (+39.1%), SKYE (+18.8%) and JBERGER (+14.9%) while AGLEVENT (-14.1%), 11 PLC (-14.0%) and MBENEFIT (-12.1%) were the worst performing.
Overall, a total turnover of 3.008 billion shares worth N30.296 billion in 24,036 deals were traded this week by investors on the floor of the Exchange in contrast to a total of 1.415 billion shares valued at N19.644 billion that exchanged hands last week in 20,659 deals.
The Financial Services Industry (measured by volume) led the activity chart with 2.539 billion shares valued at N23.510 billion traded in 13,179 deals; thus contributing 84.43 percent and 77.60 percent to the total equity turnover volume and value respectively.
The Oil and Gas Industry followed with 273.443 million shares worth N2.358 billion in 3,735 deals. The third place was occupied by consumer goods industry with a turnover of 60.840 million shares worth N2.654 billion in 3,141 deals. Trading in the top three equities namely – FCMB Group Plc., United Bank for Africa Plc., and Oando Plc.(measured by volume) accounted for 1.816 billion shares worth N9.599 billion in 3,851 deals, contributing 60.37 percent and 31.69 percent to the total equity turnover volume and value respectively.
Summary of price changes
A total of 36 equities appreciated in price during the week, lower than 37 in the previous week, while 33 equities depreciated in price, lower than 38 equities of the previous week. 100 equities remained unchanged higher than 94 equities recorded in the preceding week.
The NSE All-Share Index and market capitalization depreciated by 0.28 percent to close the week at 40,814.89 and N14.743 trillion respectively. Similarly, all other indices finished lower with the exception of NSE CG, NSE Premium, NSE-Main Board, NSE 30, NSE Banking, NSE Oil/Gas, and NSE Pension indices, which appreciated by 1.08 percent, 1.38 percent, 0.54 percent, 0.13 percent, 2.34 percent, 0.73 percent and 1.42 percent respectively.
Other products Review
Exchange Traded Products (ETPs) Also traded during the week were a total of 177,144 units of Exchange Traded Products (ETPs) valued at N2.809 million executed in 6 deals, compared with a total of 616,587 units valued at N9.185 million that was transacted last week in 21 deals.
A total of 13,735 units of Federal Government Bonds valued at N14.128 million were traded in the week in 16 deals, compared with a total of 2,500 units valued at N2.367 million transacted last week in 10 deals. Additional volumes of 10,053,532 units and 45,102,500 units were added to 14.50 percent FGN JUL 2021 and 13.98 percent FGN FEB 2028 bonds respectively on Friday, April 20, 2018.